The Appen Ltd (ASX: APX) share price has continued its gravity-defying flight of 2019 in the month of June. The APX share price was up another 13.8% last month and has hit a new all-time high this morning of $29.89. The WAAAX darling's shares started the year trading for around $12.80 but with this morning's high, Appen has delivered a return of over 131% in roughly six months!
If you haven't got FOMO yet, think about someone who bought Appen shares five years ago for 63 cents, who on today's prices would be looking at a 4,600% return!
Why do investors keep coming back for more?
Appen provides and produces research and data used for machine learning and artificial intelligence (a better name might have been Skynet). The company is a global leader in the development of these human-annotated datasets which big tech companies use to help their machines learn from humans better. Companies like Facebook, Apple and Alphabet use the kind of information Appen provides to 'teach' virtual assistants like Siri to understand and talk to humans in a natural way.
As you are probably imagining, these kinds of services are in incredible demand right now and Appen has managed to place itself at the centre of this world. Some of its clients include Microsoft and Facebook and probably others like Apple, Alphabet, Uber and Tesla (Appen doesn't actually tell us who it works with). So already, we can see that Appen has some star appeal by association.
Additionally, companies like Alphabet and Tesla are investing heavily in autonomous driving. This is a huge growth area for Appen, as autonomous driving is a process that requires a massive quantity of human data for AI systems to 'learn' from. As Appen is one of the few companies that can provide a means to this end, it stands to benefit enormously from this trend.
Appen has the numbers to back it up as well. Revenue increased by 120% from 2017 to 2018, and underlying earnings by over 150%, which are astonishing results for the company. Everyone will no doubt be watching with bated breath for Appen's next set of numbers, due in late August. If these numbers wow investors again, there's no limit to what the Appen share price might do.
Foolish Takeaway
Even though Appen's share price has reached levels that factor in years of future growth, there is little we can point to in refuting this. Appen continues to dominate its niche and deliver outstanding growth numbers and its shares reflect this. There may be plenty more upside ahead, but we will find out for sure in August.
